FEATURE-The long, brutal haul from farm to port in Brazil

* Bad roads, drugged drivers, hellish traffic, jammed ports

* Higher freight costs erode Brazil's farming gains

* Few rail, waterway options, so freight stays on road

By Peter Murphy

RONDONOPOLIS, Brazil, Nov 1 When Marcondes
Mendonça hauls corn from Brazil's farm belt to port in the
distant south, the young trucker prays for protection from
gaping potholes and dangerous drivers, and dreads the squalid
toilets on the seven-day journey ahead.

He also braces for other hassles: traffic bottlenecks,
backlogs at port and stifling bureaucracy that increasingly slow
goods and services across Latin America's largest country.

Overwhelmed infrastructure is one of the biggest challenges
facing Brazil, the world's sixth-biggest economy and a global
breadbasket that could next year displace the United States as
the world's top soybean producer.

Transporters estimate road haulage rates will rise about 30
percent once the grains crop is harvested, with a shortage of
drivers and new legislation that will keep trucks off the road
for longer by requiring minimum rest periods for drivers.

To see the problems up close, a Reuters reporter and
photographer hitched a ride with Mendonça on a recent journey. A
27-year-old father of two and fan of Brazilian country music, he
hauls freight for a truckers' collective and doubles as an
instructor for aspiring drivers.

"May God protect us," he said, above a hiss of the air
brakes. Our 1,600 km (995 miles) stretch of his 2,100 km (1,300
miles) journey took us over broken asphalt, past points of
deadly smashes, and on a nightly search for a rest stop with
space for a last truck.

The trip, from the western farm state of Mato Grosso, across
Brazil's central savannah and southeast to the Atlantic port of
Santos, highlighted rigors of the road familiar to truckers
anywhere -- long hours, loneliness and bad meals.

But it also made clear how Brazil's ambition of supplying
more of the world's food is being hampered by inefficiency.

The cost of Mendonça's haul amounted to nearly 40 percent of
what the 37 tonnes of corn sold for in Santos. Transport across
a similar distance in the United States, mostly by barge,
amounts to only 10 percent of the price of U.S. corn at port.

Goods can also take three times as long to move a given
distance as they do in China, a country that has used its run of
economic success to invest heavily in roads, rail and ports.

"Logistics are jammed up," says Glauber Silveira, head of
Mato Grosso's association of soy growers, who lose a quarter of
their revenue to transport. "The buyer is losing out and the
producer is losing out."

With ample land, plentiful water, and high-tech farms
cultivating its vast interior, Brazil is now the world's biggest
producer of sugar, coffee and citrus, the leading exporter of
poultry and beef and on the verge of becoming the top soybean
grower.

But the low-cost advantage that Brazil once enjoyed is
succumbing to rising transport costs. The jaunt from farm to
port in Brazil already costs more than twice the sea freight
fees to China, and that ratio is about to climb sharply as wages
rise and the laws on rest periods for drivers take effect.

The rising costs are forcing commodities traders to bid
higher for Brazilian soy just to make sure growers keep
planting. If prices approach costs, "it will seriously
disincentivize Brazilian production," said Kona Haque, an
analyst at Macquarie Bank.

President Dilma Rousseff recently unveiled plans to lure $66
billion in private investment for roads, rail and other
facilities. Deficient infrastructure is not only raising costs,
it is prompting fears Brazil won't be ready to host the 2014
World Cup soccer tournament and the 2016 Olympics, two events
meant to showcase the country's ascent.

OFF THE RAILS

The cabin of Mendonça's Scania truck affords ample views of
the chasm between Brazil's first-world ambitions and the much
humbler reality on the ground.

Reuters joined his journey on a Monday afternoon in
Rondonopolis, a dusty logistics hub in southern Mato Grosso. By
then, he had already driven three days north and back to load
his two tarp-covered trailers now brimming with corn.

From there, we headed south. Rosary beads dangled from the
windscreen, swinging with each bounce of the cabin.

Three hours in, we reached Alto Araguaia, a town where
Mendonça's journey could easily end. That's where America Latina
Logistica SA, a rail operator, runs the one link from
the farm belt directly to Santos, the country's biggest port.

The company's 80-railcar trains haul as much corn as 230
two-trailer rigs like Mendonça's, but burn the diesel of just 40
of them. High demand after the harvest, though, means the trains
run full and at prices producers say don't save much money.

Besides, the train takes just as long, with extended loading
times at several terminals along the track and a steep decline
near Santos port that has to be taken at crawling speed.

Brazil's rail network, spanning 29,000 km (18,019 miles), is
now smaller than it was 90 years ago.

As part of her infrastructure plans, Rousseff's government
is spending 22.4 billion reais ($11 billion) to build two major
new rail lines that should help the farm belt. One stretches
north-south, the other runs east-west.

Commodities firms say the investments can't come soon
enough. In a survey by the Fundação Dom Cabral business school
of 126 large companies that churn out a quarter of Brazil's GDP,
the No. 1 proposed solution to cut freight costs was more rail.

Economists struggle to quantify the impact of Brazil's
infrastructure woes on the economy. But most agree that a poor
transport network, saturated ports and other deficiencies
prevent the economy from consistently growing more than 4
percent a year, a rate analysts say must be sustained over time
for Brazil to attain developed nation status.

Most new rail projects are still five years away, or more.

So Mendonça drove on. Before midnight, we pulled into a rest
stop. Mendonça slept on a mattress at the rear of the cabin. The
reporter and photographer made do with a bench and a hammock.

On Tuesday, we headed for Mato Grosso's southern border, a
swooping toucan and cluster of ostrich-like rheas breaking the
monotony of the flat terrain of brown, harvested fields.

LIFE ON THE ROAD

Mendonça passed the hours by telling his story. Born in
nearby Goias state, his father and brother are also truckers.
Itching to learn, he drove customers' rigs around the yard at an
uncle's tire repair shop. "I had their permission," he said.

In 2006, he moved to Rondonopolis and started work, earning
about 3,000 reais ($1,500) a month. He put on 24 kg (53 pounds)
in his first year at the wheel. He married.

The work is steady but trucking companies are struggling to
find drivers. With unemployment near record lows, workers in
Brazil have plenty of other, less demanding opportunities.

"There are no decent toilets or rest areas and so much dust
everywhere," complained Aguinaldo da Silva Tenorio, a
28-year-old trucker along the route. In the cab beside him were
his wife, three-year-old daughter, and a month-old son. Taking
them along, Tenorio said, is "the only option" for family time.

Truckers also complain of the dangers -- occasional muggings
and bad, congested roads. Driving across Mato Grosso do Sul, the
next state down, Mendonça pointed to a spot where a drunk driver
slammed into his cabin, killing the car driver's girlfriend. "I
can't blame myself for something that wasn't my fault," he says.

Often, it's fellow truckers that he worries about. In a rush
to get to port - many are paid by the load - drivers make
reckless efforts to pass. Many also take cocaine and an
amphetamine derivative known as "rebite" to stay awake.

"When you're sleepy, it sorts you out, but you can end up
causing a huge mess," says Ademir Pereira, a 36-year-old driver
who admits to once popping the rebite pill.

Mendonça says he never takes drugs to stay awake.

TIME AT THE WHEEL

More than 1,200 truckers died on Brazil's federal highways
last year, according to police data. To dissuade drug use and
reduce the death toll, the government recently mandated rest
periods for truckers for the first time.

Employed truckers who drive most of the truck miles covered
in Brazil are now restricted to eight hours at the wheel per
day, but self-employed truck owners can press on for 13.

On Tuesday night, we slept at another rest stop.

At midday on Wednesday, Mendonça pulled into a restaurant in
the north of Sao Paulo, the last state on the journey.

There, a worker said she sees benefits from the new law.

"Before, you would see truck drivers coming in with their
eyes almost closed," says Nilda Pereira Alves Pinto, who works
the restaurant's CB radio, touting its rice and beans over the
airwaves. "They aren't in such a rush anymore."

Few disagree with the law's aims, but some complain it makes
it harder to meet demand and raises costs. "If they don't let us
drive overnight there won't be enough trucks," said Marcelo
Galbati, a self-employed trucker waiting for a tire repair.

Rousseff's plans include extending a farm-belt highway to a
terminal on the Tapajos, an Amazon tributary that flows toward
ports in the north. Despite boasting some of the world's biggest
rivers, little Brazilian freight sails.

The link will offer a route 900 km shorter to the Atlantic
from 2014 but barge capacity will be limited by shallow waters.

On Wednesday evening, we bypassed Sao Paulo, South America's
biggest city, and the traffic thickened as trucks from across
Brazil funnel onto the two highways to Santos, 80 km away.

The lack of rest areas was painfully clear. Mendonça paid a
150 reais toll for one highway but had to circle back and re-pay
after leaving the road, only to find all rest stops were full.
He'd gone beyond his legal driving time but had nowhere to stop.

At 2 a.m., as we descended through Atlantic rainforest, a
wreck halted traffic. An hour later, we reached a rest stop.

"It's looking ugly," a gate attendant said, waving Mendonça
in to try his luck for a parking spot to end a 20-hour day.

On Thursday morning, Mendonça waited for clearance to
proceed to the Santos terminal just 20 km away where Archer
Daniels Midland Co., the U.S. commodities trader, receives
truckloads of grain and dispatches them on bulk carrier ships.

The port is infamous for red tape and is strained by rising
cargo volumes. Not until 4 p.m. was the terminal ready for
Mendonça. By then, though, unloading would mean leaving port
late and another scramble for a rest stop, so he instead decided
to sleep at the terminal's waiting area.

It wasn't until Friday morning, nearly seven days after he
first left Rondonopolis, that Mendonça was finally able to pull
up to a platform and offload, just yards from the docked bulk
carrier ships filling with grain bound for other continents.

The corn's value: $10,200. The cost of the haul: $3,800.

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